Unopinionated Confidential ERC-20: Privacy-Preserving Tokens
ERC-20 is the most widely adopted token standard, but it lacks built-in privacy. Applied Blockchain introduces the Unopinionated Confidential ERC-20 Framework (UCEF), a privacy-enhanced yet fully compatible ERC-20 implementation that preserves composability and efficiency.
Privacy is a critical missing piece in blockchain tokenisation. While ERC-20 has become the most widely adopted token standard, it lacks built-in privacy features, exposing user balances and transaction amounts on-chain. This limitation presents a major barrier to institutional adoption and sensitive financial use cases.
Numerous confidential ERC-20 proposals exist, but they all share a common flaw: they are opinionated, meaning they rely on a specific cryptographic approach such as Trusted Execution Environments (TEE), Fully Homomorphic Encryption (FHE), Multi-Party Computation (MPC), or Zero-Knowledge Proofs (ZKPs). While these technologies enhance privacy, they create interoperability challenges and lock developers into a particular cryptographic solution.
Applied Blockchain has solved this challenge with the Unopinionated Confidential ERC-20 Framework (UCEF), a privacy-enhanced ERC-20 token implementation that remains fully compliant with the ERC-20 standard without modifying its interface or requiring custom cryptographic libraries.
What Makes UCEF Different?
UCEF is cryptography-agnostic, meaning it doesn’t enforce any specific privacy mechanism. Instead, it provides a modular framework where developers can integrate their preferred cryptographic techniques without changing the ERC-20 interface. This minimal design ensures:
- Composability with existing ERC-20-based decentralised applications (dApps).
- Flexible privacy rules that can adapt to evolving security requirements and compliance needs.
- Gas-efficient and auditable smart contracts that avoid unnecessary complexity.
How UCEF Works
To ensure privacy without modifying the ERC-20 standard, UCEF restricts balance visibility at the smart contract level using standard Solidity permission controls.
Key Features
- Preserves the ERC-20 standard – No changes to function names, inputs, or expected outputs.
- No custom libraries or cryptographic dependencies required – Developers remain in control of privacy implementation.
- Programmable privacy – Balance and transaction visibility can be restricted based on user-defined rules.
- Solidity-native implementation – Works seamlessly with Ethereum-based applications.
This design allows enterprises, DeFi projects, and institutional players to integrate privacy while maintaining ERC-20 compatibility.
Comparison: UCEF vs. Existing Confidential ERC-20 Solutions
Many existing confidential ERC-20 implementations impose significant trade-offs. Below is a comparison of UCEF against other privacy-preserving token standards:
Why This Matters
The need for privacy-preserving yet interoperable token standards is growing. From institutional DeFi adoption to enterprise blockchain applications, confidential transactions are crucial for:
- Regulatory compliance – Protecting sensitive financial data while remaining auditable.
- Enterprise blockchain use cases – Tokenising assets without exposing on-chain transaction details.
- Privacy-first DeFi protocols – Enabling anonymous transfers while maintaining ERC-20 composability.
By providing a future-proof framework, UCEF eliminates the biggest barriers to private ERC-20 adoption — lack of interoperability, rigid cryptographic choices, and excessive complexity.
Learn More & Contribute
Silent Data’s Unopinionated Confidential ERC-20 Framework (UCEF) is open-source and available for integration today. Developers, enterprises, and DeFi builders are encouraged to explore and contribute to the project.
Explore the full implementation on GitHub:
https://github.com/appliedblockchain/confidential-erc-20
For questions or collaborations, reach out to our team at Silent Data.
